The COVID-19 pandemic and its aftermath nearly killed off the inexpensive car in America. But cheap transportation under warranty had appeared ready to stage a rally over the past year.
However, President Trump is enacting a 25% tariff on cars and car parts imported into the U.S. beginning next week. That may, at least temporarily, halt the rebirth of the inexpensive car.
Automakers Have Trimmed Inexpensive Cars From Their Lineups
Between December of 2017 and December of 2022, sales of cars priced under $25,000 fell by 78%. Sales of vehicles priced over $60,000 soared by 163% during the same period.
As a result, automakers shifted their lineups away from more affordable models. The COVID-19 pandemic and the high interest rates of the late-pandemic period only amplified that effect. Automakers realized that only high-income, better-credit consumers could easily car shop during that period, so they adjusted their lineups to attract them.
The trend has since accelerated. Last month, Americans bought a record number of cars priced over $100,000.
Only two models sold for less than $20,000 in February — the Mitsubishi Mirage and Nissan Versa. Mitsubishi has canceled the Mirage for the U.S.
A Return Briefly Looked Possible
Last year, automakers began hearing from dealers upset that they had few inexpensive cars to sell.
Some began investing more heavily in the low end of the market. Chevrolet launched a new Trax subcompact SUV that won praise from the press and quickly became one of the brand’s best-selling models.
Nissan followed with a dramatic makeover for its Kicks subcompact SUV. It’s new on the market, but looks similarly promising.
Most Automakers Import Their Least-Expensive Models
The new tariffs, however, threaten to raise the prices of every low-priced car. Industry publication Automotive News says the resulting price increases “could be particularly pronounced at the low end of the market, with many of the least-expensive models from the likes of General Motors, Ford Motor Co., Kia Motors, and Hyundai Motor Co. being built outside the U.S.”
Almost every automaker that sells cars in the U.S. is a multinational company with operations on several continents. Nearly all of them build some of the vehicles they sell in the U.S. domestically and import others from outside the country.
Virtually every automaker, however, builds its least-expensive model outside the U.S. Just two models sold under $30,000 are built in the U.S., the Toyota Corolla and Honda Civic. Honda builds some Civics sold in the U.S. in Indiana and others in Canada.
The following chart shows every model that sold for an average price under $30,000 last month and where it is built.
| Vehicle | Average Transaction Price February 2025 | Build Location | Expected Tariff |
| Mitsubishi Mirage | $18,912 | No longer produced for U.S. | 25% |
| Nissan Versa | $20,933 | Mexico | Unknown until parts rules clear |
| Kia Forte | $21,011 | No longer produced | No longer produced |
| Jeep Cherokee | $23,126 | No longer produced | No longer produced |
| Hyundai Venue | $23,577 | South Korea | 25% |
| Kia Soul | $23,832 | South Korea | 25% |
| Nissan Sentra | $24,511 | Mexico | Unknown until parts rules clear |
| Chevrolet Trax | $24,829 | South Korea | 25% |
| Toyota Corolla | $25,275 | Mississippi | Unknown until parts rules clear |
| Jeep Renegade | $25,502 | Italy | 25% |
| Kia K4 | $25,740 | Mexico | Unknown until parts rules clear |
| Subaru Impreza | $25,943 | Japan | 25% |
| Hyundai Elantra | $26,027 | South Korea | 25% |
| Volkswagen Jetta | $26,489 | Mexico | Unknown until parts rules clear |
| Nissan Kicks | $26,611 | Mexico | Unknown until parts rules clear |
| Chevrolet Malibu | $26,835 | No Longer Produced | No longer produced |
| Buick Envista | $27,148 | South Korea | 25% |
| Mitsubishi Outlander Sport | $27,695 | Japan | 25% |
| Mazda Mazda3 | $28,095 | Mexico | Unknown until parts rules clear |
| Chevrolet Trailblazer | $28,284 | South Korea | 25% |
| Kia Seltos | $28,538 | South Korea | 25% |
| Buick Encore GX | $28,599 | South Korea | 25% |
| Fiat 500X | $29,289 | Italy | 25% |
| Nissan Altima | $29,427 | Mexico | Unknown until parts rules clear |
| Honda HR-V | $29,605 | Japan | 25% |
| Mazda CX-30 | $29,609 | Mexico | Unknown until parts rules clear |
| Honda Civic | $29,861 | Indiana, Canada | Unknown until parts rules clear |
Some Rules Still Unclear
Most of the sub-$30,000 vehicles sold in the U.S. are built outside the country. On April 3, those built outside North America will be subject to a 25% tariff.
Those built in North America will be subject to tariffs on parts that come from outside, which could begin up to a month later. The impact of tariffs on their prices will vary based on the domestic parts content of each, but all will be subject to some tariff.
Will Automakers Sell These at Higher Prices?
Automakers have just begun planning how to respond to the tariffs. But one possible response is to stop selling these cars in America. While it’s possible that middle-income buyers will be able to pay higher prices, those shopping for a car priced under $30,000 may not be willing or able to pay dramatically more.
“It’s going to be a real struggle for those buyers,” says Erin Keating, executive analyst at researcher Cox Automotive, Kelley Blue Book’s parent company. “We expect prices to rise and incentives will go away. Some vehicles could go away.”
